Government Should Use Buying Power to Reduce Costs, Arcadia's Green Says

The U.K. government should use its buying power and credit rating to cut procurement costs, Philip Green, the billionaire owner of Arcadia Group Ltd., has concluded after a two-month examination of departmental accounts.

According to the Cabinet Office, which will publish the full report today, Green found evidence of different departments paying widely varying prices for the same goods, and poor data quality in procurement control. The Sunday Telegraph reported yesterday the government was paying 10 million pounds ($16 million) a year to rent empty offices.

“There is no reason why government should not be as efficient as any good business,” Green said in an e-mailed statement. “The conclusion of this review is clear -- credit rating and scale in virtually every department has not been used to make government spending efficient.”

The announcement, with its criticism of the previous Labour Party administration that lost power after May’s general election, will be part of an effort by Conservative Prime Minister David Cameron to regain the initiative after being forced on to the defensive last week over plans to cut welfare.

Cameron will hold his first full press conference as Prime Minister today.

To contact the reporter on this story: Robert Hutton in London at rhutton1@bloomberg.net

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.